February 13, 2020 / 6:53 PM / 4 days ago

Italian court asks EU to rule in oil-gas permits dispute

FILE PHOTO: The main courtroom of the European Court of Justice is pictured in Luxembourg January 26, 2017. Picture taken January 26, 2017. REUTERS/Francois Lenoir/File Photo

MILAN (Reuters) - A top Italian administrative court has asked the EU Court of Justice to rule on legislation over the size of oil and gas exploration concessions in Italy in a move that could lead to some companies being stripped of permits.

Italian law currently forbids research in single areas off Italy’s coast of more than 750 square kilometers.

Last year a lower court threw out an appeal by local authorities against oil and gas exploration permits granted to Australia’s Global Petroleum Limited in the Adriatic Sea.

The municipalities claimed Global Petroleum had made four different requests to explore in an area of almost 3,000 square kilometers to get round the rules.

On that occasion the court turned down the claim saying there was nothing to prevent the concession areas being split up. It said European competition law favored splitting concession areas into smaller zones to foster competition.

But in a ruling seen by Reuters on Thursday the top administrative court said it believed the move had broken European competition rules, claiming it was up to member states to set one optimal size only for concession areas.

It referred the case to the EU Court of Justice.

Last year another court ruled against the southern Region of Calabria in favor of Global Med LLC in a similar dispute over exploration concessions.

The populist 5-Star Movement introduced legislation last year, with its then ruling coalition partner the League, forbidding new oil and gas exploration off Italian coasts that has since left uncertainty hanging over the industry.

Reporting by Domenico Lusi, writing by Stephen Jewkes; Editing by Kirsten Donovan

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